Leading personal consumer products manufacturer Johnson&Johnson (NYSE: JNJ) was ordered by a New Jersey state jury to pay $750 million to four plaintiffs in a lawsuit where the plaintiffs alleged the baby powder caused cancer.
The group of plaintiffs had already been awarded $37.2 million as compensation. The ruling will be reduced to $185 million because state laws limit the amount to five times the amount of compensatory damages.
J&J faces more than 16,000 lawsuits alleging it sold powders contained with asbestos and failed to warn users. It also faces investigation on how honest it has been about the products' safety. Nearly a third of those suits were filed last year.
J&J denies that its product causes cancer, saying that numerous studies have shown its talc is safe and asbestos-free. Plaintiffs' lawyers claim internal J&J documents show executives knew since the late 1960s that talc mined in places such as Vermont and Italy contained trace amounts of asbestos but failed to alert consumers or regulators.
Johnson & Johnson recalled about 33,000 bottles of baby powder in October after a U.S. Food and Drug Administration contractor found small amounts of asbestos in samples of baby powder. The company later blamed the FDA contractor for the scare, saying outside testing found no asbestos in baby powder samples.
"The jury listened to all of the evidence and determined there is a need for deterrence" to insure consumers are aware of the talc-based powders' health risks, said Christopher Placitella, an attorney for the plaintiffs. Jurors spent more than two weeks hearing evidence that showed J&J officials knew there was asbestos in its baby powder and failed to warn consumers, Placitella said.
Johnson & Johnson said it will appeal the lawsuit and complained in a statement of "numerous legal errors that subjected the jury to irrelevant information and prevented them from hearing meaningful evidence."